The US and EU have been at loggerheads since Trump angered European allies by announcing tariffs on steel and aluminum as he launched trade restrictions targeting China in particular.

European Commissioner for Economic and Financial Affairs Pierre Moscovici presents the EU executive's spring economic forecasts during a news conference at the EU Commission headquarters in Brussels, Belgium. (Image: Reuters)

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Buenos Aires: EU finance chief Pierre Moscovici fired a barb at US President Donald Trump on Sunday as he called on both sides of an ongoing global trade dispute to "act as allies."

The US and EU have been at loggerheads since Trump angered European allies by announcing tariffs on steel and aluminum as he launched trade restrictions targeting China in particular.

Referring to Trump branding the EU, alongside China and Russia, as trade "foes," Moscovici said the EU is "willing to build bridges." "What I stressed several times in my meetings here is that the EU is certainly not the author of major trade imbalances," Moscovici told reporters during the Group of 20 summit in Buenos Aires.

US Treasury Secretary Steven Mnuchin on Saturday spoke at the conference about wanting to "balance" the country's trade relationships with China and the EU, calling on both to respect "free, fair and reciprocal trade." But Moscovici said that "we believe that targeting us is certainly inappropriate... and that we must act with the US as allies — not foes but allies." "These meetings take place in an international context which is changing," he said.

"The multilateral system of which the G20 is a central piece is under significant pressure, trade tensions are high and threaten to escalate further. All of this creates uncertainty for the economic outlook." He added: "We must remain cool-headed."

Trump's protectionist policies have come under fire from all sides at the summit, which groups finance ministers and central bankers from the world's 20 largest economies.

French finance minister Bruno Le Maire on Saturday called on Trump to "return to reason." As well as imposing tariffs of 25 percent on steel and 10 percent on aluminum, Trump stuck a 25 percent levy on $34 billion of goods from China with an additional $16 billion on the way.

He has threatened to target European automotive exports and to impose duties on the entire $500 billion of goods the US imports from China.

"The impact of protectionist measures already implemented has been, luckily, so far limited, but the risk of escalation is there," said Moscovici.

The International Monetary Fund predicts that in a worst-case scenario, $430 billion — or a half percentage point of global GDP — could be cut in 2020 if all tariff threats and retaliations are carried out.

"Further trade escalation conflicts would negatively affect welfare in all countries involved — in the US also," said Moscovici.

Protectionism, he said, benefits no one, creating "no winners, only casualties." IMF chief Christine Lagarde had warned on Wednesday that the US economy was "especially vulnerable" to trade conflicts "because so much of its global trade will be subject to retaliatory measures."